Goldman Sachs is not expecting oil to rally despite the US tightening sanctions on Iran

Goldman Sachs is not expecting oil to rally despite the US tightening sanctions on Iran

Oil prices jumped more than 2% in the previous session, hitting their highest level this year amid intensifying concern about global supplies after the U.S. announced a further clampdown on Iran's oil exports.

International benchmark Brent crude traded at $74.40 Tuesday morning, up around 0.5%, while U.S. West Texas Intermediate (WTI) stood at $65.93, almost 0.6% higher.

Goldman Sachs expects the United States' decision to end exemptions from sanctions for countries still buying oil from Iran to have a limited impact on crude prices, even though the timing is likely to have caught energy market participants by surprise.

"While we acknowledge the near-term upside price risks, we reiterate our fundamentally derived Brent price trading range of $70-75 per barrel for the second quarter of 2019," the U.S. investment bank said in a research note published Monday, Reuters reported.

The world's largest economy said Monday that from May 1, it would eliminate all waivers allowing eight economies to buy Iranian oil without facing U.S. sanctions.

Oil prices jumped more than 2% in the previous session, hitting their highest level this year amid intensifying concern about global supplies after the U.S. announced a further clampdown on Iran's oil exports.

International benchmark Brent crude traded at $74.40 Tuesday morning, up around 0.5%, while U.S. West Texas Intermediate (WTI) stood at $65.93, almost 0.6% higher.